Five ways federal IT can increase innovation while cutting costs

Federal IT is in the midst of a huge transformation, driven by initiatives ranging from IT Reform and Federal Data Center Consolidation to CloudFirst, CyberFirst and FutureFirst. In May 2012, President Obama released a memo detailing new directions for Federal IT as part of the Digital Government Strategy.

Moving to a 21^st-century foundation for federal IT is an exciting opportunity; at the same time, the transformation presents quite a challenge as budgets for IT remain tight. Today’s efforts are all about streamlining IT to achieve operational efficiencies and ultimately achieve more value for less money. All of which needs to happen. But initiatives to transform IT also demand it to be innovative. How can federal IT do both?

5 principles for increasing innovation while decreasing costs

If you want innovation in a reduced budget environment, the only way to do it is to reduce the tasks you’re giving your best staff – your senior people. They’re the ones who are knowledgeable about your environment and your problems. These are the people you need to free up.

Luckily, the actions you take to free your top people from M&O drudgery are the same actions that can help reduce costs. If you’re spending 80% of your resources keeping the lights on, it’s hard to innovate (see “Innovation or maintenance: The right choice to save your business” for more information). Here are five principles that can help:

• Be ruthlessly selective: Innovation takes time. Approve fewer projects so you can free up your staff. By doing less, you can focus more time on managing the things you are doing well. You can’t be a jack of all trades. Typically this strategy will also shorten the change life-cycle time, an added benefit.
• Improve your IT governance: I’ve written before about how a solid IT governance practice can decrease your costs. Anything you can do to decrease internal costs helps you become more efficient, which frees up time.
• Focus on executing well: To innovate you need to make change happen faster. If you want faster cycle times, apply more resources to fewer problems. You’ll improve your ability to execute faster. Also fine tune leaderships ability to have transparency and visibility into the execution of key projects, both transformational and operational. After you have right sized your portfolio of initiatives, it is usually easier to focus on “doing the right things right”.
• Automate as much as possible: Any type of automation – whether client, server or network – will free up more time and therefore drive innovation. Even tools you may not think of for automation may give you the ability to automate some part of your processes. For example, I know some federal agencies that use our project and portfolio management (PPM) tool also use it to automate all demand for IT, including data calls, CPIC, change management and test management. Hence, there is one tool for all demand, both strategic and operational.
• Use cloud where it makes sense: I believe shared services delivered over cloud infrastructure can offer huge efficiency gains (and I’ll write more on this later). While most federal agencies will probably be looking to private cloud, there are some ways to leverage public cloud. For example, Jerry Horton, the CIO of USAID, moved his agency’s email to Gmail. By moving to a cloud-based solution, USAID is reducing operating expenditures and expects to realize cost savings of nearly $20 million over the next five years.

Moving our work from the tactical to the strategic and impactful is a challenge we all face. As a leader, you want your best people doing strategic analysis forecasting and planning. But if they’re too busy putting out fires they can’t focus on strategic transformational initiatives that require the best thought leadership. Use the tips above and you’ll free up time to innovate, without increasing cost. Who knows, you may even save cost and free up money for future innovation.